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Check Before You Invest : Suprajit Engineering Ltd

BSE: 532509 NSE: SUPRAJIT ISIN: INE399C01030
  |   Sector:  Automobiles   |   Industry:  Auto Ancillary

Snapshot

Q.1 Which industry/sub-sector does Suprajit Engineering Ltd belong to?
Suprajit Engineering Ltd belongs to the Automobiles sector, operating specifically within the Auto Ancillary segment.
Q.2 Is Suprajit Engineering Ltd a good quality company?
Suprajit Engineering Ltd is a good quality company, based on a consistently good multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Suprajit Engineering Ltd undervalued or overvalued?
Suprajit Engineering Ltd appears Undervalued, as its key valuation ratios are lower than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 44.12 35.91
Price to Book 4.45 4.45
Price to Sales 1.67 1.96
EV to EBITDA 14.65 16.10
Q.4 Is Suprajit Engineering Ltd a good buy now?
Suprajit Engineering Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Suprajit Engineering Ltd?
Suprajit Engineering Ltd revenue growth is 13.2% for FY-2025, which is below its 5-year CAGR of 15.96%, indicating slower growth.

Q.2 Gross Profit margin of Suprajit Engineering Ltd?
Suprajit Engineering Ltd Gross profit margin which is the profit after deduction of direct costs, is 9.7% for FY-2025, which is below its 5-year median of 11.5%, indicating decreasing margins.

Q.3 Operating Profit Margin of Suprajit Engineering Ltd?
Suprajit Engineering Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 10.17% for FY-2025, which is below its 5-year median of 11.39% indicating decreasing margins.

Q.4 Net Profit Margin of Suprajit Engineering Ltd?
Suprajit Engineering Ltd Net Profit Margin is 3.03% for FY-2025, is below its 5-year median of 5.78%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 9.7 11.5
Operating Profit Margin (%) 10.17 11.39
Net Profit Margin (%) 3.03 5.78

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Suprajit Engineering Ltd?
Suprajit Engineering Ltd Return on Asset is 3.76%, which is below its 5-year historical median of 7.31%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Suprajit Engineering Ltd?
Suprajit Engineering Ltd Return on capital employed is 13.14% for FY-2025, which is below its 5-year historical median of 15.69%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 13.5%, indicating value preservation.

Q.7 Return on Equity (ROE) of Suprajit Engineering Ltd?
Suprajit Engineering Ltd Return on equity is 7.56% for FY-2025, which is below its 5-year historical median of 13.3%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Suprajit Engineering Ltd?
Suprajit Engineering Ltd Cash conversion cycle is 73 days, in line with its 5-year historical median of 74 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 1.24 1.16
ROE (%) 7.56 13.3
ROCE (%) 13.14 15.69
Cash Conversion Cycle 73 days 74 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Suprajit Engineering Ltd?
Suprajit Engineering Ltd Debt-to-Equity ratio is 0.52, which is above the industry average of 0.40, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Suprajit Engineering Ltd?
Suprajit Engineering Ltd Debt to cash flow from operations is 3.56, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Suprajit Engineering Ltd?

Q.1 Promoter shareholding and pledge status of Suprajit Engineering Ltd?
Promoters hold 45.26% of the Suprajit Engineering Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Suprajit Engineering Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Suprajit Engineering Ltd vs industry peers?
Suprajit Engineering Ltd revenue CAGR is 15.96%, compared to the industry median CAGR of 11.82%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 13.2 11.8
Gross Profit Growth (%) -3.9 16.3
Operating Profit Growth (%) 3.1 14.9
Net Profit Growth (%) -40.7 20.2
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.24 1.23
ROE (%) 7.56 11.57
ROCE (%) 13.14 13.36
Cash Conversion Cycle (days) 72.71 47

Valuation & price assessment

Q.1 Stock return of Suprajit Engineering Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 11.7% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
11.7% 12.7% 6.1% 16.4%
Q.2 Valuation ratios of Suprajit Engineering Ltd vs historical?
The current P/E ratio of 44.12 is higher than its historical median of 35.91, indicating that the stock is trading above its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings 44.12 35.91 28.71
Price to Book 4.45 4.45 2.99
Price to Sales 1.67 1.96 1.35
EV to EBITDA 14.65 16.10 11.85

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